Monday, 29 July 2013

With the main indexes closing moderately lower, the VIX managed a closing gain of 5.3% @ 13.39, having spiked to 13.86. Underlying momentum is swinging back to the equity bears, but a further VIX wave lower looks likely..which would make for some interesting divergences.

VIX'60min

VIX'daily3

Summary

The hourly MACD (blue bar histogram) cycle is set to go negative at the Tuesday open, and that sure doesn't bode well for the equity bears across tomorrow.

Similarly, the daily charts saw the VIX close with a black-fail candle, and those are very often warnings of further equity upside.
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The main indexes closed with very minor declines, the sp -6pts @ 1685. The two market leaders, Trans/R2K saw more significant falls of 1.1% and 0.7% respectively. Despite the declines, market still looks set for further upside across Tue/Wednesday.

sp'60min

Summary

Not the most exciting of days, indeed, after the late morning low in the low 1680s, it turned out rather dull.

Yes, the VIX spiked 8%, but that still makes for a VIX in the 13s. Equity bears really can't get the least bit confident until VIX 15/16s.

*The bears do have something of a window though, in that there is no sig' QE across Tue/Wed.

With the bears exhausting their power at sp'1681, the bulls are seeing the usual latter day recovery/rally. A close in the 1690s looks very viable, and that will open up the still elusive 1700s early Tuesday. Oil is marginally red, along with the metals.

sp'60min

Summary

All things considered, we're more likely to rally..than slip into the close.

Bears had their chance, and instead of breaking back into the 1670s, they've left a rather clear inverse H/S formation, which is highly suggestive of the 1700s tomorrow.

The main indexes are holding moderate declines, and despite an expected little more upside in the near term, the weekly charts are starting to looking particularly tired. If sp'1710/20s are hit later this week, the market will be well over-extended.

sp'weekly8

Summary

A long week ahead, but for the bears out there, the current candle on the rainbow chart is indeed a blue one, the first bit of weakness since the June'24 low - as seen across a number of indexes.

I'm still assuming a little more upside..before the reversal though.

Plenty of econ-data this week to give the market an excuse to ramp, never mind the 'we won't taper' FOMC.

The main indexes are still moderately lower, but the bears look powerless to muster any more downside today..or even tomorrow. A possible inv. H/S formation is offering the low sp'1700s within the immediate term.

sp'60min

Summary

Not much to add, aside that it does look we'll rally into the close. Best case for the bulls....a Tuesday gap higher..right into the 1700s, which will open up 1720s for FOMC Wednesday.
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VIX update from Mr T.

Clearly, very few are seeing imminent threat of significant VIX upside.

The bears look exhausted after another minor down cycle. Once again, we look set for latter day ramp, with the mid sp'1690s very much viable at the close. Metals and Oil are recovering, and look set to close moderately green. VIX appears to have maxed out at 13.86

The market is holding moderate declines, but like the previous one thousand trading days, there is little reason why the bulls won't manage a latter day rally. Precious metals and Oil remain somewhat weak, despite the probability of QE-taper this Wednesday effectively zero.

sp'60min

Summary

There really isn't much to say, other than the bears have again managed morning declines, but...why will we not rally into the afternoon, as we have so many times before?
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Still no significant power on the bear side...sp'1710/20s still the target.
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*I'm still long SLV, but if it breaks <19.00...I get the boot.
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Notable movers so far today, AAPL and FB, both significantly higher, and that doesn't bode well for those equity bears looking for downside into the Monday close.

Despite a slightly weak open, the underlying pressure remains to the upside, with the main indexes already close to turning green. Bulls still look set for the sp'1710/20s this week. VIX hourly chart is offering a classic black-fail candle to start the week.

sp'60min

vix'60min

Summary

It really doesn't look good for equity bears, not least with a $3bn QE-pomo due to kick in this hour.

A close in the low sp'1700s looks very viable by the close of today, and that should open up another 10-20pts across Tue/Wednesday.
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Precious metals look choppy..

SLV needs to hold the 19.00s at the close of today. Hourly pressure is currently in favour of upside.

Good morning. Futures are a touch lower, sp -3pts, we're set to open at 1688. Precious metals and Oil are slightly higher, with a fractionally stronger USD. Market will no doubt be focused on a very broad array of econ-data later this week, along with another FOMC.

sp'60min

Summary

Today will likely be the quietest day of the week, things really don't get going until tomorrow.

Considering the price action last Friday, we'll surely close higher today, and with QE of $3bn, the bulls could manage their first close in the sp'1700s.
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*I am still long SLV, and seeking an exit later this morning. I'm certainly looking to short the indexes, but no earlier than Wednesday morning, and preferably in the sp'1710/20s.
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9.04am... and the metals break to the downside. Hmm. Hourly charts are still suggestive of broader gains as the day progresses.

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